Decision between CFA and FRM

Hi everyone,

I am new to AF. I would like to get some inputs regarding CFA and FRM.

I have worked in the banking industry for about 10 years, but my speciality is in process re-engineering and continuous improvement. I haven’t really worked in any finance or investment related position. My education background is BA in Economics and HRM. I also have courses in financial planning as well.

I am interested in changing my career to one of the three areas: portfolio management, risk management or performance measurement. My questions for all of you are as follow:

  1. Based on my limited working experiences and education background in finance and investment, what would be a better designation for me to pursue?

  2. Which would be easier to handle? I know both designations are very challenging and I am not trying to find something easy. I just want to find something that is easier to start with.

  3. Or can you recommend any other internationally recognized designation in these areas? (not CA, CPA or CMA)

Thank you very much for your inputs!

always cfa first. nobody knows what frm is…

Matt, good to see back and posting.

FRM is meant to be a lot easier. I’m not sure how much value the designation would have without experience though. The people I know who have FRM have it as a compliment to their experience in Markets Risk.

This is a CFA centric board, so I think you’re going to get a biased view towards CFA.

You mentioned you wanted to get into portfolio management, risk management or performance measurement. Each one of these has it’s own designation with exams (CFA, FRM, and CIPM), so maybe choose which it is you want to get into and go from there.

Personally I don’t think you can go wrong with CFA in terms of it helping with your career ambitions. I think what you need to consider is whether you’re willing to commit to a gruelling program of study whose eventual benefits are uncertain.

Thanks for your reply, Matt Likes Analysis. I tend to agree with you as well. But do you think that CFA will be ‘too’ challenging for someone who does not have too much industry experiences and education background to handle? I am not looking for short-cut but trying to figure out the best way to start. Thanks again for your comments.

Thanks cleverCFA for your inputs. Since I haven’t decided on one specific interest area, I think it is worth exploring all these different opportunities. Like I mention earlier, if one designation is easier (based on your comment is FRM) and has a good value, I will consider that one first. I just want to find something easier to start building my foundation and knowledge base in these areas, then get into something deeper after. Thanks for mentioning about CIPM as well. I am actually looking into that we well. So hopefully I will be come to a concusion soon.

CIPM has been revamped from previous years it seems, much more calculation intensive and less GIPS or so i hear.

Hi Alladin, what make you register for the CIPM exam? Is it because you are alreayd a CFA charter holder? I want to understand your rationale behind your decision.

No rosy answers to this one from me i am afraid. I failed L3 last year and do not plan to take it in 2013 and will not take it unless and until i am motivated in some way again. I registered for the CIPM exams because the material is somewhat interesting and to minimise the regret of having a year pass without anything to show for it. Hopefully you have better reasons/motivations for doing it haha…

In any case,the CIPM is offered twice a year and the exam is computer based (although i personally prefer paper based). 100 questions and 3 hours time i think.The principles level of the exam has about 717 pages with a couple of optional segments bringing it down to 680ish pages.

Hope this helps

Good luck.


Would you say that the CIPM is similar to Level 3 of the CFA (without the GIPS)? How many hours do you anticipate studying for it? Is it limited only to Portfolio Management (no valuation or corporate governance)?

Well, judging by the volume of material ( in terms of pages), the CIPM principles level is about a fifth to a quarter of the CFA L3, so they are really not that comparable i guess in terms of how much time you need. The material itself is basically the performance evaluation readings from CFA Level 3 with a much greater emphasis on calculating various returns (e.g you actually need to calc the money weighted returns here whereas in L3 you didn’t as far as i remember,some currency stuff,equity and bond returns aswell).The difficulty of these calculations reminds me more of L2/L3 than L1. The return attribution section seems to be a bit more indepth (in terms of derivation) as compared to L3. There is also risk attribution which i don’t think was there in L3 (dont remember much though). It is not about portfolio management but evaluation after the fact. No corp governance that i can see. CFAI has refurbished the CIPM by a lot it seems…40% gips down to 15% i think… more calculation intensive, apparently to achieve a better balance with the experts level…there are a couple of readings that are completely devoid of EOC questions,not sure what to do with those to be honest.

hope this helps

I think this is a good reason. I don’t want to feel guilty of not taking courses as well. I also need to get the momentum going. If I stop for a while, I will probalby never register any courses to improve myself. Quantitative is not my strength and that is also the area I want to improve. The amount of materials seem to be less overwhelming compared to any level of CFA. Am I making the wrong assumption? In terms of difficulty, would you say Level I CIPM is similar to Level I CFA?

Go for CFA level 1. If you are worried about the amount you need to know for L1 take the Dec exams but order the books earlier. It just makes more sense than the CIPM in your case. The calculations for the CIPM principles level, as far as i can see, are more nuanced than CFA L1 but the volume of the CFA texts more than makes up for that !

CFA 1 in June 2013, CFA 2 in June 2014, PRM exam 3&4 by Nov 2014, CFA L3 June 2015.

You’ll then be CFA and PRM.

I think that this makes the most sense to me as well. I just want to make sure that I am sctually ready for this before making this commitment. But thanks for the advice.

Hi pokhim, This is a great plan, but I will definitely not be ready for the CFA L1 exam by June. I will only be setting myself up for failure if I aim for June. If I have a strong investment or finance background, I will probably give that a try… Thanks for the great plan.


  1. As you are not from finance background,it actually depends on your interest in this feild

  2. As per my knowledge FRM is easy then CFA

  3. I think you should select from CFA & FRM only as both of the courses can provide you a good career

Actually the selection of any course depends on n numbers of facts say; your interest in this feild; your time devotion, which material you are using etc…

In my own experience, generally speaking, I found FRM curriculum to be more quantitative, focussed and deep while the CFA course material is vast but shallower.

Also, your decision should be based on where you want to end up in your career. The CFA material is more appropriate for a career on the buy side with a strong emphasis on asset classes, portfolio theory etc. On the other hand, FRM is more suited for a career in Risk Management with a tilt towards the sell side (heavy emphasis on Basel and Value at Risk (VaR)).

Hi Pokhim,

Have you taken PRM exams? I have been looking into it for a while now since I don’t have to take level 1 & 2. Level 4 consists of bunch of case studies but Level 3 looks calculation intensive. If you have taken the exam, can you tell me how much time (on average) would be needed to ace each of these two levels? Thanks.